March 14, 2016

Swipe Right for Free Trade

In this Mint articleVivek Dehejia, Resident Fellow at IDFC Institute, writes that India should stand firm for genuine free trade and should not sign trade agreements such as TPP that do not serve its national interest.


He writes "India lacks the clout either to engineer a reboot of DDA or to shape the structure of emerging alternatives to TPP, in particular, the Regional Comprehensive Economic Partnership (RCEP), which is likely to be a Chinese-led (read: Chinese-captured) agreement"

"In the case of India’s trade policy options, that improbable, but possible, option is to pursue unilateral trade liberalization in sectors where it makes sense for the Indian national interest, while at the same time holding out for the possibility of a reinvigorated multilateral process at some point in the future. The flip side is that India must stand firm for genuine free trade and not be suckered or cajoled into signing up for TPP or, indeed, for RCEP, if it turns out to be stacked in favour of China as TPP is for the US.

This will require not only that Indian trade negotiators continue to demonstrate intestinal fortitude, but that Indian policymakers and commentators push back against the insidious Orwellian newspeak which allows well-known folk shilling for the US to assert that India, in particular, is hung up on “old-fashioned” issues such as tariffs and conventional trade barriers and is missing the bus on tackling “beyond the border” trade-related (read: non-trade-related) policy areas such as domestic regulatory standards, the intellectual property regime, and so forth."

"The correct litmus test, therefore, is whether any particular policy domain included in a trade negotiation is likely to result in mutual gain (swipe right), or whether it is likely to involve a transfer of surplus from one to the other party (swipe left). Reducing or eliminating tariffs and other distorting taxes and subsidies easily passes this test. Harmonizing labour or environmental standards or the intellectual property regime does not."


Topic : Transitions / In : OP-EDS
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